Policy, Institutions and Misallocation

Sammanfattning: The thesis contains three models. Chapter 1 illustrates financial market incompleteness causes misallocations and fluences international trade pattern. Countries with more complete markets tend to specialize in risky sectors. Chapter 2 sets up a cross-generation utility function. Results show fertility constraints harm social mobility and create misallocations through multiple channels. Chapter 3 shows financial segmentation in China is the cause of housing bubbles and creates misallocations. Bubbles improve allocations by crowding out inefficient investments.